All ponzi schemes are trust of people developed by psychological principle of ‘selective honesty’

You can use many parameters for trusting a person.The best I know is your gut feel.

Initially we judge people based on gender,color,race,religion,attractiveness,our preconceived notions etc.

But once we know core values of some one, we must trust our gut feeling. Predictability can be constructed to fool people. All con artists work in this manner. They establish trust by a set pattern.

Let me give you an example.

How people con others by taking credit of large sums and running away?

Steps in which con artist works

  1. Suppose I want to con you. I will ask for a meager sum like 50/- which you can give me without much risk involved. Even if I don’t return,your mind thinks its okay risk to assume.
  2. I return it next day promptly without you asking for it.
  3. I repeat the pattern with 100/- this time. You are little hesitant since its 100/- bucks but your mind tells you that last time I returned promptly.
  4. I again return you promptly.
  5. Moving in such a manner I keep on doubling the amount. I offer you interest of 2% per month. Its seem too good. 24% per year.
  6. I have a set record of repayment promptly. You give me money. I keep on giving interest from your money only for next few months.
  7. My name is big in the market. Human mind has a habit of gossiping. You tell (boast ) your friend about unforeseen profits! They are also interested. Soon news take shape of jungle fire. I keep on collecting cash and go on paying interest from money collected!
  8. I promise to pay money at the end of two years. After enough money is collected,I run away with the cash! A ponzi scheme is busted.

Every time in human history, all these schemes have worked on the very same principle. Each time minds flaws have worked against it.

Hence in case of trust remember one basic rule : If its too good to be true,it probably is.